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Friday January 27th, 2023

Sri Lanka PM rejects allegations of cabinet-sanctioned election directive

President Ranil Wickremesinghe and Prime Minister Dinesh Gunawardena at United National Party 76th anniversary celebration

ECONOMYNEXT – Sri Lanka Prime Minister Dinesh Gunawardena denied that the cabinet of ministers had decided not to accept cash deposits from nominees for the local government elections scheduled for March.

Responding to a question by opposition legislator Anura Kumara Dissanayake in parliament on Tuesday January 17, the prime minister said the cabinet had not taken a decision pertaining to election deposits.

“At every cabinet meeting, we discuss issues in the country. If somebody said that, it is an incorrect news,” said Gunawardena.

MP Dissanayake and opposition leader Sajith Premadasa had sought an explanation from the government about a controversial circular attributed to Public Administration Ministry Secretary Neil Hapuhinna ordering all District Secretaries who function as Returning Officers not to accept deposits.

The circular was withdrawn by the ministry secretary hours later, after it drew the condemnation of opposition political parties who claimed it was an illegal order and an underhand tactic to delay the polls. Opposition parties claimed that the circular had been issued following a decision reached at last week’s cabinet meeting. According to MP Dissanayake, the secretary to the cabinet of ministers had conveyed the decision to Hapuhinna, directing him to issue the directive to the district secretaries.

The National Election Commission, an independent body with the sole authority to conduct elections and issue directives to returning officers, summoned the ministry secretary for an explanation of his actions, prompting the latter to issue an apology.

Responding to the allegations, Prime Minister Gunawardena said the cabinet had taken no such decision and had not decided to delay the local government election.

Demanding an explanation for the official’s action, Opposition Leader Premadasa asked the government in parliament on Tuesday what action it planned to take against the official if he was acting of his own volition as claimed.

“Mr Hapuhinna sent this letter as a decision taken by the cabinet. It wasn’t a personal decision of his. We want a straight answer to this: Did the cabinet take such a decision?” asked Premadasa.

“I have already answered this question. They’re asking the same question again. The opposition leader does not listen,” responded Gunawardena.

MP Dissanayake said: “The secretary to the cabinet of ministers is who conveys cabinet decisions to relevant ministry secretaries. It’s his certificate that officially becomes a cabinet decision.”

“If the cabinet secretary is sending out decisions that were never made by the cabinet, what is happening in this country? This is a serious matter. What if sends some other letter tomorrow?”

The MP, who leads the Janatha Vimukthi Peramuna (JVP)-led National People’s Alliance, charged that President Ranil Wickremesinghe and United National Party (UNP) MP Vajira Abeywardena had ordered the cabinet secretary to issue the directive.

“The government is not within the cabinet; it is with [President] Wickremesinghe and Vajira Abeywardena,” said Dissanayake.

Premadasa asked if there is a super-cabinet that functions above the ordinary cabinet.

“This was a decision that was put together in secret. Hapuhinna was compelled to send it to the returning officers because it was deemed a cabinet decision. This is a frightening situation,” said Premadasa.

A heated exchange also erupted between opposition leader and prime minister, with the former calling a latter a “peon” or office assistant.

Prime Minister Gunawardena retorted that it was in fact Premadasa’s father, former President Ranasinghe Premadasa who during his tenure as prime minister under President J R Jayawardena, had famously referred to himself as a peon.

Responding to further questions, Gunawardene said that government officials have the right to recall erroneously issued directives as was the case with the public administration ministry secretary.

“The cabinet paper that Mr Dissanayake is talking about was not there. In the event of an error, the ministry secretary can issue a correction. That’s why Secretary Hapuhinna issued an immediate correction that same evening,” he said.

“If the opposition leader proposes that the public administration ministry secretary is removed, it cannot be done based on incorrect information,” he added.

With President Wickremesinghe who was in parliament on Tuesday right next to hm, Gunawardena also responded to the allegation that the real cabinet was the president and his party.

“You said the man on top or the second in command is doing everything. The country shouldn’t be run by you who is at a lower level. The country rejected you,” he said. (Colombo/Jan17/2023)

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Sri Lanka’s Dialog Axiata hopes to hold prices despite rising costs

ECONOMYNEXT – Sri Lanka’s Dialog Axiata hopes to hold prices despite higher taxes, rising costs like energy, officials said as the country goes through the worst currency crisis in the history of its intermediate regime central bank.

High inflation following a collapse of the currency has reduced real incomes of customers.

“There are many factors to consider, especially with the last price increase we did in last year did not resulted in a significant increase in revenue” Pradeep De Almeida · Group Chief Technology Officer at Dialog Axiata said at the launch of its Future zone at Lotus tower.

In September,2022 following an electricity tarrif hike dialog increased its tariffs on Mobile, Fixed Telephone, Broadband Plans and Value Added Services (Prepaid and Postpaid) by 20 percent while tariffs on all Pay Television Services were raised 25 percent.

Value Added Tax (VAT) was also raised by the government from 12 percent to 15 percent on all Telecommunications and Pay TV services.

“Even though we increase the prices we only saw around 8-9 percent increase in revenue,” Almeida said.

“That is because many users cut off their usage to limit the spending”.

Dialog will increase efficiencies and manage costs in an attempt to avoid prices increases for customers, he said.

Over the 24 months to December 2022, Sri Lanka;s central bank has generated inflation of 76 percent, based on the Colombo Consumer Price Index official data shows. Following the currency collapse, more power tariff hikes are planned.

“We are trying to mainly bear the cost from our side. We are getting a massive support from our parent company Telekom Malaysia International,” Navin Peiris, Group Chief Enterprise Officer at Dialog told EconomyNext.

“Therefore as of now, there is no plan to increase prices”. (Colombo/Jan 26/2023)

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Sri Lanka shares fall at market close on profit taking

ECONOMYNEXT – Sri Lanka shares fell on Thursday as profit taking entered the market mainly on financial and diversified sectors, brokers said.

The main All Share Price Index (ASPI) fell 0.13 percent or 11.50 points to close at 8,926.56.

“The market was trading on dull trade mainly due to profit taking,” an analyst said.

“Also we saw investors taking a sideline as quarterly reports started to come”.

The earnings in the first quarter of 2023 are expected to be negative with revised up taxes and an imminent electricity tariff hike.

Earnings in the second quarter are expected to be more positive with the anticipation of IMF loan and possible reduction in the market interest rates as the tax revenue has started to generate funds.

The central bank’s policy decision was expected and investors have been eying on IMF deal with hopes of rapid economic recovery from the current unprecedented economic crisis, however since the market gained in the last sessions profit taking has come about, analysts said.

The market has been on a rising trend on the hopes of a faster IMF deal. However, the central bank government said the IMF deal is likely in the quarter or in the first month of the second quarter.

The most liquid index S&P SL20 fell  0.33 percent or 9.21 points to 2,798.

LOLC had seen some attention by investors as the firm disposed 90,256,750 shares held with Agstar PLC at 15-17.50 rupees a share.

The market witnessed a turnover of 1.2 billion rupees, lower than the month’s daily average of 1.9 billion rupees.

Expolanka dragging the market down closed 2.36 percent down at 186.7 rupees a share. Sampath bank fell 1.41 percent to close at 42 rupees a share while Royal Ceramic Lanka closed 2.59 percent dwn at 30.1 rupees a share.


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Sri Lanka bonds yields steady at close

ECONOMYNEXT – Sri Lanka bond yields were steady at close on Thursday, dealers said, while a guidance peg for interbank transactions by the Central Bank remained steady.

A bond maturing on 01.05.2024 closed at 31.00/20 percent unchanged from the last close.

A bond maturing on 15.05.2026 closed at 26.60/90 percent, up from 28.50/70 percent on Wednesday.

A bond maturing on 15.09.2027 closed at 28.60/85 percent, up from 28.50/60 percent at the last close.

The three months bill closed at 29.75/30.25 percent unchanged from the last close.

The Central Bank’s guidance peg for interbank US dollar transactions appreciated by another 2 cents to 362.14 rupees against the US dollar.

Commercial banks offered dollars for telegraphic transfers at 360.49 rupees on Thursday, data showed.  (Colombo/Jan 26/2022)

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